By | Dr Pavan Soni | IIM-B Innovation Evangelist
Why do startups fail?
One of the biggest reasons upstarts fail is because they fail to strategize. Strategy here refers to a plan of action that helps one create a sustainable competitive advantage. While starting a business might just take enthusiasm and some muscle power, but sustenance calls for a well laid out roadmap, and an understanding of both the objective and the approach.
Subroto Bagchi, in his book the Elephant Catchers, lament that scaling doesn’t come naturally to startups, or even the entrepreneurs, and this very ability to scale determines the fate of an idea.
While the greatest advantage a startup has is its clean slate and no baggage, one of the biggest lacune would be a lack of discipline. Remember, it is not an idea that makes a real difference, but rather it is the ability to give the idea a shape that makes all the difference. It’s the very act of execution which carries all the risk, and hence the premium.
The important question then is- how much is strategy important?
To this my response is, ‘a strategy without execution is a daydream, and execution without strategy is a nightmare.’
Most startups err on the side of executing without having a strategy.
You need strategy for the simple reason that you should be able to discern that whether your failure was owing to a bad plan or poor efforts, else you are bound to repeat your mistakes.
I conduct a one-day workshop on Strategy for Startups, where I take the audience through various tools, techniques and frameworks of Strategy creation and execution.
The key takeaways are as follows:
- How to rigorously assess and firm up your business idea
- Developing an understanding of your unique value proposition and competitive advantage
- Creating a roadmap of expanding your business
Some of the tools and techniques discussed in the session are as follows
- Porter’s Five Force Model,
- Value Stream Mapping,
- Competitive Positioning,
- Identification of Resources and Capabilities – VRIN Model
- PESTEL Analysis
- Hybrid Brainstorming.
- Strategy Canvas.
- Lean Startups
- Business Model Canvas.
- Elevator Pitch
Hope that you make the most of the opportunity.